JD Sports investors remove remuneration committee head from board

Investors at JD Sports have voted to kick the company’s remuneration committee head off the board after years of discontent with its pay practices.

JD Sports on Thursday said nearly 55 per cent of voting shareholders had failed to back the re-election of Andrew Leslie, who had sat on the fashion group’s board for 11 years, prompting him to step down with immediate effect. The London-listed company said it would elect a temporary chair of its remuneration committee and begin the search for Leslie’s long-term replacement.

Executive pay has become the biggest flashpoint at AGMs in the UK this year, with rebellions at companies such as Informa, Rio Tinto and Cineworld. But it is unusual for non-executive directors to be booted off the board.

Institutional Shareholder Services and Glass Lewis, two influential advisers to many of the world’s biggest asset managers, had recommended that shareholders vote against the re-election of both Leslie and executive chair Peter Cowgill.

Investors backed a special bonus worth £3m for Cowgill, which brought his total pay for the year to January 2021 to £4.3m, while the company took about £61m in furlough support from the UK government during that year.

On Thursday, JD Sports raised its full-year profit guidance to at least £550m following a boom in sales during the pandemic.

ISS said the sportswear group’s remuneration reports had “consistently registered significant levels of dissent” since 2014, a period during which Leslie has chaired the relevant committee.

“Given the continued level of dissent, along with ongoing concerns regarding the viability of the remuneration arrangements at the company, the director’s re-election cannot be supported,” it added.

The proxy adviser also noted that it no longer considered Leslie to be an independent director, as he had served on the board with Cowgill for more than a decade.

JD Sports said Cowgill’s “special bonus” had been approved by shareholders in 2019, before the pandemic, partially as the executive chair does not receive contributions from the company’s pension scheme.

It noted that only 17 per cent of voting shareholders had rejected the company’s new share based long-term incentive scheme, with 20 per cent disagreeing with its remuneration policy, giving the two policies “considerably more support than . . . at the AGM in 2020”.

Just under a third of votes cast were against the company’s remuneration report, which included the special bonus handed to Cowgill, who saw more than 15 per cent of votes cast against him.

Additional reporting by Attracta Mooney